Phillip Burton Federal Building, San Francisco. Sam Wheeler via Wikimedia Commons.

Ah… faith in humanity restored.  Just a bit.

In a rant yesterday (NO, 4(f)(3) is NOT co-equal to Hague channels!), I took issue with the impossibly bad logic in another order approving electronic service on a Chinese defendant under Rule 4(f)(3).  Simply put, S.D. Cal. got it wrong, the latest in a string of cases steeped in impossibly bad logic.  But at the other end of the Golden State, Magistrate Judge Alex Tse, who has been on the bench a mere six months, got it right.

In Facebook, Inc. et al v. 9 Xiu Network (Shenzhen) Technology Co., Ltd. et al., No. 4:19-cv-01167 (N.D. Cal.), Judge Tse recommended that the District deny the plaintiff’s motion for leave to serve various Chinese defendants electronically.  His holding (if it can be called that before adoption by the District Judge?) relied on a far more accurate interpretation of Rio Properties v. Rio International Interlink than the Victaulic opinion, which drew so much of my ire yesterday.

The plaintiff in Rio was based in the United States and attempted to serve a defendant in Costa Rica.  Costa Rica isn’t a signatory to the Hague Service Convention[*], so service under 4(f)(1) wasn’t applicable. Service under 4(f)(2), in contrast, was theoretically possible, but the means of service identified in 4(f)(2) weren’t practical under the circumstances; so rather than first attempt service under 4(f)(2), the plaintiff asked the district court to authorize service by e-mail under 4(f)(3), which the district court agreed to do.

Bingo.  Going on…

It is easy to understand why courts, after reading Rio, have concluded that the methods of service identified in the Hague Service Convention are not exclusive.  Service under the Convention proceeds through 4(f)(1); and Rio held that Rule 4(f) doesn’t prohibit a plaintiff from bypassing 4(f)(1) and first requesting an alternative means of service, such as service by e-mail, under 4(f)(3). The implication seems to be that the methods of service identified in the Convention are optional, and that even if the Convention applies, service by e-mail may be utilized if approved by the court.

This reading of Rio, although understandable, is too expansive.  Rio interpreted Rule 4(f), not the Hague Service Convention; and when the Convention applies, it must be considered. The Convention is a ratified, self-executing treaty, and as such is “the supreme law of the land.” (citations omitted.)

I disagree on one point there:  Judge Tse is entirely too kind.  It’s not easy to understand why courts have concluded that Hague methods aren’t exclusive– it’s utterly baffling in light of Schlunk, and I’ve been beating my head against a wall over it for years.  To be sure, I don’t think Rio analysis is even necessary in light of Justice O’Connor’s logic– the stronger basis for denial of 4(f)(3) alternatives in China– but it does highlight the problem with Gurung and its progeny.

Still, this one reaches the right result on the specific request.  If the Central Authority says an address is wrong, then that (as Judge Tse indicates) takes the Convention out of the equation, but that doesn’t seem to be the plaintiffs’ basis for the motion.  Regarding the as-yet-unaddressed defendants, the next step is to invoke Article 15 and proceed toward default.**  I sense that China is unlikely to ever effect service in this case, so a default seems appropriate under the treaty’s terms.  In that instance, the defendant’s due process rights must still be vindicated, and that’s where Rio and 4(f)(3) alternatives can enter the fray– but only to provide Mullane notice, rather than formal service.

* Costa Rica actually is a Hague party now, but wasn’t in 2002, when Rio was handed down.

** True, this triggers overseas enforcement concerns, but China isn’t going to enforce a U.S. judgment anyway.

Hat tip to Katerina Ossenova, my colleague at the Department of Justice, for pointing out this case.